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Rethink

Sunday 31 July 2005

This is a huge step ahead, but leads directly to a question: why should a forest acquire value only when it is slated to be lost? If the npv the Court has assigned -- Rs 5.8 lakh for each hectare (ha) of scrub forest land; Rs 7 lakh per ha for open forest and Rs 9.2 lakh per ha of dense forest -- is applied to standing forests in states, what would India's forest cover be worth? (see table:Rs 5,92,01,90,20 lakh). It is completely inconceivable that the Centre would (be able to) cough up such an amount and distribute them to states. And if the Centre did, forest conservation would remain the dole game it is today.

In this situation, the positive thing to do would be to create a system of localised payments for the ecosystem services of forests, necessarily involving local communities. There are four basic services for which there is a clear demand: one could reward people for conserving biodiversity, providing carbon sinks, protecting watersheds, and maintaining scenic beauty or recreational values. But the only way this can happen is if these services have real values attached to them.

Paying for ecological services is not a new phenomenon. Many countries are already on this road to conservation. And they are on this road because, wherever forest evaluation has been applied, the 'command and control' approach of governments have failed. Add to this the problem of limited state budgets and decreasing funding from external agencies, and localized payments could prove a longer-term solution to financing conservation in India.

Speaking of the payments the sc wants made, Chopra, who has carried out numerous valuations, believes "The money needs to go back to the people dependant on forests -- as incentives to protect forestland or in compensation for its loss." Local communities obviously have the highest stakes. Thus, a 'beneficiary pays' principle would better suit standing forests, where they pay who need the services, in the form of incentives to local communities.

Other developing countries have initiated incentive-based conservation, recognizing that degradation of forests is primarily financial, and that the main players in forest conservation are local communities. The basic approach is to change the behaviour of land-users, encouraging them to adopt environmentally benign landuse and discouraging them from harmful land uses. All of these involve externalities as well as the need to price ecological services correctly: if Catskill farmers had not changed their methods, for example, New York City would not have faced the question of how to keep its water potable. But when an externality affects a relatively small, recognisable group of people, negotiation between the parties can often resolve the matter.

Projects going on in the Changar region of Kangra district in Himachal Pradesh are exploring micro-level intra- and inter-village payments. A model thay have dreawn inspiration from is that of the older traditional systems of water harvesting -- like the kuhl or canal system -- had elaborate mechanisms for management, with intricate upstream-downstream rules, rights and responsibilities negotiated over time. Significantly, at the macro level, project initiators found that mechanisms for payments for watershed protection services -- by downstream beneficiaries such as hydroelectric power projects and city municipal water supply agencies to communities protecting or depending on forests located in upstream areas or to Joint Forest Management committees -- could bring substantial livelihood and equity benefits to local communities.

The right to land Over 300 pes (payment for environmental services) systems have been inventoried in the world. The diversity of pes approaches is mind-boggling. In other words, not only is pes eminently applicable, but also it is not a monolith. India's approach too, needs to be tailored to its own circumstances. The main peculiarity here is that our poorest people, many of whom live in forests, have no rights. Since many pes systems link land use to the provision of services -- payments are based upon clear land rights -- its application without a land rights regime for those who protect forests could create more alienation.

The example of the participatory watershed management programme in India is particularly relevant here. Improved irrigation and increased agricultural productivity were immediate benefits of the programme. But these were benefits that only landholders enjoyed; the main incentive for the landless was employment as labour while work related to project lasted. Once this got over, they no longer had a stake in protecting the watershed, or the forests in them. Also the value of marginal lands improving led to more powerful groups putting a claim on it.

Lack of secure rights to land or even to forest produce makes forest conservation extremely complex. There are many examples in India where people protect forests, but for this communities need -- at least -- access and withdrawal rights, and management rights. But it is also true that incentives do not have to be land-based, nor do they have to be direct cash payments, as was shown in Sukhomajri, where water rights were delinked from land. The pani panchayats in Maharashtra also work this way. Such innovative approaches to expand rights -- including rights to environmental benefits, for example -- are needed.

To move ahead, J Rao Matta and John Kerr, who did an empirical study of Joint Forest Management (jfm) -- also about giving people incentives to protect forests -- in Tamil Nadu say that "there is no discussion on compensating those who live on forest fringes for environmental services they provide through improved protection and ecological restoration". jfm in India has faltered because incentives to people, tied just to forest produce, were too small to make it sustainable. The strategy was that local communities would manage forests if they were compensated with resultant forest produce; many states elaborately talked of 'benefit sharing'. In reality, either the highly degraded forests provided little by way of tangible benefits, or the 1996 ban on felling came in the way of gaining from harvesting timber. And various rules in different states -- that keep changing -- restrict access to non-timber forest produce.

This points to the fact that the process needs to be accompanied by enabling policy. One that ensures benefits also go to the poorest, and one that takes into account certain subsidies -- for example those that encourage agriculture to the extent that it becomes more profitable to cut forests to grow crops -- as well as conflicting forest regulations and other blind spots that would riddle holes in any attempts to move in a new direction.

Putting a true value to forests could transform the way forest conservation is done. Methods exist. But does the political will exist that trusts local communities?

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